Source: China Appliance Magazine (run by CHEAA)
China’s rising young consumers is changing the mainstream consumption concept of this big market. In laundry market, this works too. China’s laundry sector is witnessing a rise of personalized and niche demands, which opens up new opportunities for the industry. At this moment, industry players play their ace cards by rolling out target products including multi-tub washers and washer dryer combos, fueling a change in the market landscape.
A distinct structural change
China’s home appliance industry enters a stage that features accelerated upgrading, transformation and changes after 30 years of development. As to laundry sector, upscale products, including front loaders, inverter washers, and large-capacity, smart, healthcare washers, have become the mainstream of the market, propelling the market to go high-end and specialized.
With no doubt, front loaders have been the most powerful booster of the market. Statistics monitored by All View Cloud showed that, from Jan to Nov 2017, front loaders took a market share of 70% offline by retail sales value, and more than 60% online.
Front loaders of leading players such as Haier, Midea, Little Swan and BSH have claimed a crucial market position by sales. BSH’s washers are all front load types. As to Midea and Little Swan, the proportion is 50%, Whirlpool 40%-50%, Panasonic 40% and Konka 30%. Skyworth’s front loaders take more than 50% by sales value. Our interviewee from Konka says, “Front loaders are the future of this category, though Konka currently falls behind top brands in this segment.”
This trend can also be reflected by the rising demand of front loader use drive motors. According to Du Rongfa, Vice President of Wolong Group, demands for front loader use drive motors have been rising year-on-year from 2016 to 2019 with an average growth rate of 3.3%. It is estimated that this demand will reach 33.962 million units as of 2019.
The market share of top loaders is squeezed as major washer makers shifted their focus towards front loaders. Statistics from All View Cloud showed that, from Jan to Nov 2017, top load washers took a market share of 27.7% offline by retail sales value, down by 4.3% year-on-year, and 45.9% by retail sales volume, down by 3.9% year-on-year. At online channels, top loaders took a market share of 36.2% by retail sales value, down by 2.9% year-on-year, and 52.9% by retail sales volume, down by 1.8% year-on-year.
Inverter washers take an increased share of the market year by year as the concept of energy efficiency and environmental protection takes root in more and more people. Statistics from China Market Monitor suggested that, from Jan to Nov 2017, inverter washers took a market share of 55.89% offline by retail sales volume, a year-on-year growth of 8.6%.
BLDC-driven inverter washers stand out with low noise, high energy efficiency and accurate control compared to non-inverter washers. “Recognized by consumers amid China’s consumption upgrading, inverter technology has been widely used in laundry industry. It is a future trend.” Wang Weiqing, Vice President and Chief Sales Officer of BSH China, told China Appliance reporter that, “BSH has finished upgrading its full-line washers into BLDC-driven inverter washers in 2017.”
Large capacity makes another trend. According to All View Cloud, from Jan to Nov 2017, top load washers with a capacity of 8.0kg made the best seller of its category accounting for 30% by retail sales value. Those with a capacity more than 8.0kg saw a rise in retail sales volume. As to front loaders, 8.0kg is also the best-selling capacity. At offline channels, 10.0kg washers are expanding fast, and are expected to make the best-selling capacity in 2018.
Zhou Guoxian, General Manager of the washing machine product line of Skyworth, believed that, what lied behind the large capacity trend is consumers’ improved living standard and consumption level. “Currently, 8kg or more has become the mainstream capacity on the market. In the future, 10kg or more will be too.” Our interviewee from Konka’s marketing division revealed that Konka has upgraded the capacity of its full-line fully automatic washing machine and front loaders to 10kg.
Wang Weiqing, Vice President and Chief Sales Officer of BSH China, believed that two factors propelled this trend: consumers’ upgraded demand and the industry’s upgraded technology.
Healthy washing, a rising trend
Healthy washing is another key word of laundry market in 2017. “Cleaning free” “degerming” and “self-cleaning” products are getting trendy. Washing separate loads of clothes at one time, multi-tub washers gain particular popularity.
Our interviewee from Haier told our reporter that, as “self-cleaning” became a buzzword, more and more consumers started to realize that dirt building up between the outer and inner tubs could soil the clothes again. Our reporter found that, on the washing machine page of JD.COM, a leading online retailer in China, “degerming” “self-cleaning tub” are listed as keywords. Under the keyword “degerming”, more than 800 products are for sale, while under “self-cleaning tub”, there are more than 1,600.
An industry insider said, through different approaches, almost all washing machine enterprises are putting weight on the development of healthy-washing machines.
To offer a cleaning free experience, Haier’s “no water between tubs” technology, certified as a national technology achievement, solves the dirty tub issue. Panasonic’s Care+ system allows consumers to easily clean unseen build-ups with a simple tapping of its “tub cleaning” program.
Multi-tub washers featuring separate washings are also budding to be a new trend. They can be found in both front loaders and top loaders.
An industry insider pointed out that, as consumers’ concept of washing clothes change, the idea of separate washing is getting more and more recognized. “Clothes need to be washed separately for families with kids, especially babies. This has become a common habit of new moms. For others without kids, clothes and underwear needs to be washed in separate loads for health considerations. A multi-tub washer could perfectly meet these emerging needs.”
In this context, washer makers at home and abroad start to put weight on multi-tubs, with rollouts from Little Swan, Haier, Hisense, Samsung and LG. Our interviewee from Midea revealed that, the rising demand of separating adults’ and children’s clothes in washing is what lies behind Midea’s move of developing multi-tub washers. “Currently, we have rolled out a multi-tub washer for large households, which integrates a top load tub and a front load tub in one machine. With a capacity of 15kg, the largest of the industry, it is able to wash a load of 12kg or dry a load of 8kg at the lower tub, while wash a load of 3kg at the upper one. Before it hit the market, 8kg max at lower tub had been a bottle neck to break for the whole industry.”
Hot as it is, some manufacturers take a wait-and-see attitude. Zhou Guoxian from Skyworth said, Skyworth was currently doing an in-depth analysis of consumer needs, and would roll out a proper product at a better time. Tong Huaijun from Whirlpool said, Whirlpool didn’t have a multi-tub washer yet but it had the technology already. “We have the technology. But considering our strategic deployment of products globally, we haven’t put it into our plan, yet it could be a possibility down the road. We’ll see how the market develops.”
Dryer market gearing up to boom
Witnessing a surge in 2017, dryer sector became a significant part of laundry industry. Both separate dryers and combos expanded fast in market size. According to China Market Monitor, retail sales volume of dryers in China is expected to reach 192,000 units, a year-on-year rise of 42%, and the sales value 680 million RMB, a year-on-year of 81.2%.
In our interviews, most interviewee expressed their faith in the prospect of this sector. With a great track record of dryer sales in China, BSH rolled out some new models in 2017. Wang Weiqing from BSH introduced that, both Bosche and Siemens placed new products on market in the past year. Bosche 6 series, equipped with three automatic air drying programs, meet various drying needs of consumers easily. In cooperation with Suning, Siemens released its iQ500 series dryers, which featured heat pump technology, a self-cleaning condensing system and multiple drying programs.
Samsung’s new dryers used heat pump to dry clothes at low temperatures, and are equipped with air refresh technology and smart control.
Washer dryer combs also rose fast. According to All View Cloud, from Jan to Nov 2017, combos took a market share of 16.8% online and 21.8% offline by retail sales value, a year-on-year rise of 6.8% and 5.7% respectively, and 6.4% online and 11.7% offline by retail sales volume, a year-on-year rise of 2.6% and 5.1% respectively.
Zhou Guoxian from Skyworth had his eyes on combo market. He revealed that, Skyworth’s i-DD direct inverter combo, with a capacity of 10kg, used breaking technologies to achieve smart drying, degerming and smart control.
Wang Weiqing from BSH told our reporter that, BSH has been putting weight on the R&D of combos. Their focal point is degerming, energy efficiency, easy-to-use operations, and smart control.